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Full text of "Rapid Population Growth Consequences And Policy Implications"

generation has imposed heavy costs on their parents in the last 2 decades, but is today reaching mature labor-force age, and increasingly the society must contend with a youthful, rapidly growing labor force with its implicit demands for increased savings and investment.
A future change in fertility would also have a clear short-run effect on the age structure. A 10 percent decline in birth rates would within 10 to 20 years reduce the proportion of the population younger than 15 by a comparable fraction. A decline in fertility would, therefore, not only slow population growth, but in the short run it would lead to a sharp reduction in the dependency burden.
Within the family, the acceleration in population growth that began 2 decades ago is today reaching the stage when the burden on family resources of child support and education is likely to be most acute (26). If as a variety of evidence suggests, parents respond to those accumulating economic pressures by seeking to avert additional births when they reach their desired family size, the birth rate among this relatively small group will begin to fall, relieving gradually the burden on family resources. The availability of modem means of birth control may hasten this trend and save parents and society the costs of unwanted births, as appears to be the case in Taiwan.* When and if fertility declines in this manner, it is likely to contribute to a resurgence of household savings and investment in tangible assets.
For similar reasons, the public sector's opportunities to save and invest its resources in tangible productive assets appears first to be eroded by rapid population growth, because public expenditures on social infrastructure (such as schools or hospitals) are closely tied to population growth, urbanization, and the youthfulness of the population. If public and private expenditures on education and health are reconsidered as investments in the future productive capacity of the younger generation, household and public sector savings no longer appear depressed by population growth in the aggregate, though they are probably still strained on a per-child basis. I Thus, over a family's formation cycle or over different countries at one moment in time, high fertility, rapid population growth, and high dependency are all associated strongly with low physical savings rates (15-17, 22, 29). But in the case of countries undergoing the postwar acceleration in population growth, the apparently low physical savings rate neglects to show the growing fraction of private and social resources being invested in the human productive agent.
The speed with which birth rates fall may depend critically on public and private efforts to disseminate modern means of birth control. Without such
*Various methods have been used to evaluate the effect of the Taiwan Family Planning Program, and all suggest that substantial reductions in the birth rate may be attributed to the program. For a program evaluation study using multivariatc nonlinear regression analysis allied with a behavioral model of fertility as discussed in this paper see (3).
'See Leibenstein, "The Impact of Population Growth on Economic WelfareŚNon-r. (1, Vol. Ill, Appendix 7, pp. 2067-2075.) See also the chapter by Leibcnstein in this volume.